Hedge fund Alden Global Capital, one of the country's largest newspaper owners with a reputation for intense cost cuts and layoffs, has offered to buy the local newspaper chain Lee Enterprises for about $141 million.
In a news release Monday, Alden said it sent Lee's board a letter with the offer. It already owns 6% of Lee's stock and is proposing to buy the rest for $24 a share.
Lee stock jumped 22% to $22.59 Monday. The Iowa company's spokesperson did not immediately reply to a request for comment. Lee's papers include the St. Louis Post-Dispatch and the Buffalo News, along with dozens of smaller papers in more than two dozen states.
Alden scooped up the Tribune papers earlier this year in a deal that was bitterly contested by the Tribune company's own journalists and community leaders in Tribune's markets, who sought, ultimately without success, to find local buyers for papers including the Baltimore Sun and Chicago Tribune. Alden also owns the Denver Post, Orange County Register and Boston Herald.
Alden has a reputation for slashing costs that go even beyond the newspaper industry’s overall turn in that direction. The newspaper business has been consolidating as it struggles with a digital transition and shrinking revenues, and financial firms like Alden have taken an increasingly prominent role as owners. Newsroom jobs dropped nearly in half from 2004 to 2018, according to Pew Research, and the pandemic has exacerbated those stresses. About one-fourth of the country’s newspapers have closed n the past 15 years, according to research from the University of North Carolina.
Alden said Monday that its offer for Lee is a “reaffirmation of our substantial commitment to the newspaper industry and our desire to support local newspapers over the long term.”